By TIOL News Service

NEW DELHI, March 1, 2006 : SECTION 23 (2) of the Customs Act , 1962 is proposed to be amended so as not to allow for relinquishment of the title of the goods. This is an interesting move as the declared owner of the imported goods, at any time before an order for clearance of goods for home consumption or an order for permitting the deposit of goods in a warehouse is made, cannot disown the goods and will have to incur the duty liability of such goods and face further action thereof , in case any offence is detected with respect to the said consignment. ( Refer Clause 58 of the Finance Bill )

Similar changes are proposed in Section 68 of the Customs Act, 1962 which as on date provides for clearance of warehoused goods for home consumption that the owner of any warehoused goods may, at any time before an order for clearance of goods for home consumption has been made in respect of such goods, relinquish his title to the goods upon payment of rent, interest, other charges and penalties that may be payable in respect of the goods. Now with Clause 59 of the Finance Bill, the owner of the warehoused goods in respect of which an offence appears to have been committed will not be allowed to relinquish his ownership of such goods.

CONSUMER WELFARE FUND – GETTING RICHER ?

“Consumer Welfare Fund” means the fund established by the Central Government under sub-section (1) of section 12C of the [Central Excise Act, 1944] (1 of 1944).

Clause 64 of the Finance Bill , 2006 seeks to amend Section 12C of the Central Excise Act so as to provide that the excess amount of Service Tax collected from any person after adjustment of the said tax, shall be credited to the Consumer Welfare Fund.

As apparent, there was no provision to credit the excess amount collected as service tax and the same is proposed to be taken care of by this amendment. Can we say, the CONSUMER WELFARE FUND appears to be getting richer ?

ADVANCE RULING AUTHORITY GETS MORE TEETH.

SECTION 23C ( 2) of the Central Excise Act, 1944 ( as it stands on date ) provides that the question on which the advance ruling can be sought shall be in respect of, -

(a) classification of any goods under the Central Excise Tariff Act, 1985 (5 of 1986);

(b)applicability of a notification issued under sub-section (1) of section 5A having a bearing on the rate of duty;

(c) the principles to be adopted for the purposes of determination of value of the goods under the provisions of this Act;

[(d) notifications issued, in respect of duties of excise under this Act, the Central Excise Tariff Act, 1985 (5 of 1986) and any duty chargeable under any other law for the time being in force in the same manner as duty of excise leviable under this Act;

(e) admissibility of credit of excise duty paid or deemed to have been paid on the goods used in or in relation to the manufacture of the excisable goods.]

Now Clause 65 seeks to amend Section 23C ibid so as to confer on the Advance Ruling authority the power to decide the Excisability of any product. Advance Ruling authority hopes to be now more empowered!!!

Main Hoon Na!

If SRK’s super hit “Main Hoon Na” found place in the FM’s speech in the last budget, this year our own PC decided to stay away from Bollywood – No Big ‘B’ this time around – He had enough of controversy already!! Instead spirituality was the norm of the day as Swami Vivekandandaji was very much in the agenda today. Quoting liberally , he exhorted that :-

"We reap what we sow. We are the makers of our own fate. The wind is blowing; those vessels whose sails are unfurled catch it, and go forward on their way, but those which have their sails furled do not catch the wind. Is that the fault of the wind?...We make our own destiny", he quoted the youth saint as saying.

Fusion of philosophy with economics, our FM was not to be left far behind !!

His passion was evident when he referred to Saint Tiruvalluvar’s words "Karunam Sidhaiyamal Kannoda Vallarku, Urimai Udaithu Iv Ulagu (The world is his who does his job with compassion)". Thoreau was also not forgotten - "If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them."

YOUR ATM CARD SHOULD GOT DEARER.

There is confusion over PC’s decision to levy service tax on ATM- related services.

Though the picture is still not clear, before dumping one’s ATM card straightaway, it may be understood that there will be no service tax for withdrawing your hard earned money from the Bank using the same banks ATM Card. Hopefully, you keep the ‘hard earned money’ only in the Bank.

Some of the views emerging on the subject matter are

Service Tax on the transaction fee

- For processing ones application for ATM and such related services.

- if money is withdrawn from the ATM of one bank using the debit card of any other bank.

- If you pay for your petrol vide the credit card. ( The transaction fee is presently pegged at 2% of the price of petrol purchased )

If you are unlucky to your shopping mall charge transaction fee for general purchases / payment of mobile bills – like bills etc made therefrom.

Let us await the detailed guidelines which hopefully will not follow the axiom – If you cannot convince, just confuse !!!

"Recovery of Confirmed Demands under Service Tax – When the going gets tough – the tough gets going !!!

What if the proposed new Section 11DDA and the draconian attachment thereof has not seen the light of the day.. How about an assault packaged differently ? If FM has his way, we will soon have a provision to ensure recovery of confirmed demands under Service tax. Section 87 is proposed to be inserted so as to provide that the Government by any one or more of the following methods may recover any demand of Service tax confirmed against a person:

a. Deducting any sum payable to such person under Central Excise or Customs.

b. Requiring any person to pay the amount owed by them to the service provider, against whom the demand is pending, directly to the Government.

c. Distraining of any goods that are belonging to such person or under the control of a person from whom any service tax confirmed demand is pending.

d. Adopting the time tested ( but often failed ) Certificate action.

Wonder why our own PC did not risk being repetitive about “Hum Hain Naa” ?